A number of business plans have reached their year of fruition, having been focused on 2020 since 2015 when they set in place a five-year plan of transformation.
We examine what businesses will be turning their attention to for the next five years, identify the top trends shaping HR professionals’ agenda for 2020 and draw upon the recent results of our autumn UK Reward Management Survey 2019.
1. C-Suite contribution
The role of the HR professional has changed dramatically, redefining someone dedicated to processes and more administrative tasks to those responsible for coaching individuals through their careers and being essential to driving business analytics and strategy. HR leaders will operate at the intersection of technology and people, needing to be tech-savvy and responsive enough to manage a restless and agile workforce.
HR professionals are increasingly seen as strategic advisors focused on business strategy and employee career paths, moving beyond carrying out the heavy lifting of compliance and pay review planning and other essential HR tasks. CEOs will increasingly leverage HR’s expertise in making projections and mobilising people to deliver their vision. With a more bottom-up approach and flatter hierarchies being commonplace, HR is key to managing newer structures that challenge traditional notions of company structures and how they should be best managed.
2. Instant HR processes and feedback
Technology is freeing up HR to take on more holistic, strategic matters, making the field more innovative and dynamic. Continuous pay reviews would in fact reflect what is common practice for many organisations through their out of cycle pay award systems. 75 per cent of respondents to our UK Reward Management survey say that market pressures drive out of cycle pay reviews, which were traditionally reserved for making adjustments based on promotions throughout the year. This suggests that these increases supplement incremental pay awards in order to retain top talent.
Whilst some might worry that the use of less formal performance reviews removes the rigour of the annual pay review process, embracing a flexible approach can drive employee retention. Employers can ensure that their employees are competitively paid throughout the year and that their reward reflects their contribution to the business. Adopting an ad hoc approach to reviews promotes frequent 1:1 meetings between managers and employees, as opposed to formal once a year reviews. This continuous dialogue concerning performance can produce better outcomes, enabling employees to correct behaviours immediately and drives productivity.
3. The rise of HR analytics, automation and artificial intelligence
Much of the hiring process can be driven by a wealth of data that can objectively inform decisions, with automation potentially removing any unconscious bias in recruitment decisions and identifying the best candidates based on KPIs. However, the human dimension cannot be neglected in the context of HR – the focus on people and over-commoditisation of the recruitment process risks undermining the culture of a company. Manager scrutiny is still an important part of the process to ensure that the right candidates are successful. However, employers must harness technology to drive insights into the needs and motivations of employees and modernise their approach, whilst continually testing how this is affecting the culture and impacting employees; do not lose the focus on the employee as an individual.
Equally, on-boarding and time intensive tasks such as answering questions from new starters can also be tackled by Chatbots, which are currently widely used in customer services and IT support. Chatbots can help employees by answering frequently asked questions, especially in relation to benefits and compensation. Streamlining these HR processes supports the employee experience, using the power of technology to free up HR to concentrate on shaping the strategy and tackling business-critical people projects. Personnel Today anticipates that the three priority areas for HR analysis in 2020 are: resourcing, retention and employee wellbeing.
4. Multi-disciplinary approaches throughout organisations
Whilst traditionally HR has been seen as distinct and separate from IT, Marketing and Sales, the fusion of these disciplines is important in driving innovation within organisations. IT systems must support HR objectives, with machine learning techniques and algorithms being used to automate recruitment, work and create consumer experiences for employees. People analytics can also be harnessed to direct performance management, recognising the individuals who most deserve recognition and driving retention.
Equally, effectively marketing a strong employee value proposition and defining what sets your company apart, can help tackle the recruitment challenges experienced by 55 per cent of respondents in our UK Reward Survey in 2019. Communicating competitive benefits packages that promote financial wellbeing, physical wellbeing and align with personal values such as shared parental leave, enhanced maternity packages and flexitime are crucial to attracting and retaining talent. In this sense, the HR function must ‘sell’ the proposition both to outside talent who need to buy in to the brand to apply and to existing employees through their internal communication system to reinforce the value of working there. Bringing these disciplines together can drive employee experience, as functions work closely to achieve continuous positive experiences at all stages of the employee journey – from application, to onboarding and even exit interviews.
5. Flexible working and total rewards
Managing a remote workforce will become the norm. In Mercer’s Global Talent Trends Survey, they refer to the term ‘Permanent Flexibility’ to describe work arrangements that reflect the modern digital lifestyle. With generational differences being a key challenge to ensuring all spectrums of the workforce are engaged (traditionalists, baby boomers, generations X, Y and Z). This involves rethinking the whole concept of office spaces and who does the work itself.
The gig economy will also grow, with Intuit estimating that by 2020, 40 per cent of American workers will be independent contractors. Remote working practices will be driven by globalisation, leading to an increasingly diverse workplace that could even be contracted on a project by project basis, with colleagues from around the world being brought together based on their specific skillset to meet customer demands. Project managers are increasingly being used to compartmentalise aspects that can be allocated to freelancers, redirect workflows and drive efficiency, all transforming the way employees work. Results-driven performance analysis models will be increasingly expected from HR.
6. Mental health
Mental health and wider employee wellbeing in the workplace has dominated the news in 2019, and will undoubtedly shape HR agendas over the coming year. Our autumn UK Reward Management Survey 2019 captured employer attitudes towards mental health, with 100 per cent reporting workplace stigma as a barrier to managing mental health in the workplace. 83 per cent had policies and procedures in place to specifically support mental health, which is an encouraging starting point for success to build on in 2020.
Wider wellbeing can drive down rates of absenteeism and employee turnover and improve engagement and productivity levels. Only 11 per cent had processes to track and measure the performance of initiatives designed to tackle mental health and wellbeing, whilst making the case for a return on investment was consistently cited as a barrier to investment in dedicated mental health programmes. 44 per cent of employers reported a boost to overall employee health and wellbeing, perhaps tracked by a reduction in the number of sick days taken within the year. For some, initiatives are in the very early stages of implementation and it is early days.
Keep ahead of the curve
As employers increasingly re-think the design and organisation of their workplace, the traditional 9-to-5 is already being challenged by an on-demand culture of contract-based specialists. Those firms who are not continually adapting and responding are at risk of stagnating. The crucial key to success will be to maintain a cohesive environment that is driven by a strong brand identity throughout an organisation. Organisations must foster and translate their purpose into a strong brand experience for both customers and employees. On-boarding, transparent cultures promoting fairness and harnessing the power of automation can all help to create a workplace of tomorrow that thrives.
Get in touch to discuss how Paydata can help you plan ahead in 2020.